National Project Bank (NPB) and

National Project Bank Management Information System (NPBMIS)

Sushil BhattaMember, National Planning Commission

Government of Nepal

Outline

RETROSPECT RECENT DEVELOPMENT WAY FORWARD

Retrospect

• First meeting of the Infrastructure Financing and PPP Network of

Asia and the Pacific (12 - 13 September 2018).

• PPP Operationalization, Creation of Viable Gap Funding & Project

Development Fund,

• Capacity Building for PPP Implementation, Mainstreaming the PPP into

provincial and local level,

• Establishment of National Project Bank (Project Pipeline & Web Portal)

Context

Context

Nepal a land-locked, but not potentially locked

(rich natural resources, demographic and geographic dividends)• Unitary to Federal Structure : Stable government at federal, province (7) and local

level (753) • Area: 147, 181 Sq. Km• Population: 26.67m (2011 census)• Economic Growth Rate: ~7% (2018), 8.5% (FY 2019/20, targeted)• Total Budget: USD 13.66 billion (FY 2019/20) • Per Capita Income: USD 1074

Development Vision & Goals

National Vision: Prosperous Nepal, Happy Nepali• 15 Periodic Plan (2019 – 2023) : Generate Prosperity • 16 & 17 Periodic Plan (2023 – 2032) : Accelerate Prosperity • Beyond 2032 : Sustain Prosperity

National Goals:• Least Developed Country (LDC) graduation to developing country by 2022, Middle-

Income Country (MIC) by 2030• Full commitment of SDGs achievement by 2030• 25 Years Vision Paper (2043) – around 10 % growth targeted, per-capita income USD

12,100

Constraints

POLICY & LEGAL (UNILATERAL TO FEDERAL SYSTEM)

INSTITUTIONAL CAPACITY FINANCING GAP

Costing and Financing

SDGs (2016 – 2030)

Average annual requirement (AAR): USD 18.37 bn

Contribution for SDGs• Public : 55% • Private: 45%

Finance gap: USD 5.31 bn• Public: USD 1.97 bn• Private: USD 3.34 bn

15th Periodic Plan (2019/20-2023/24)

Targeted an average growth of 10.3 percent over the next five years

Per capita income: USD 1595

Total investment: USD 84 bn (FY 2018/19 price)• Government : 39% (AAR - USD 6.53 bn) • Private : 55.6% (AAR – USD 9.32 bn) • Cooperative : 5.4% (AAR - USD 0.9 bn)

Private sector has to play a vital role in achieving national goals

Costing and Financing

Recent Development – PPP Initiatives

• Legal and Policy Framework• Institutional set-up with one stop

solution• Setting up of NATIONAL PROJECT BANK

at NPC (Screening, appraisal, selection and prioritization)

Legal & Policy Reform

PUBLIC PRIVATE PARTNERSHIP AND INVESTMENT BILL, 2019FOREIGN INVESTMENT AND TRANSFER OF TECHNOLOGY ACT, 2019SPECIAL ECONOMIC ZONE ACT (FIRST AMENDMENT), 2019HEDGING REGULATIONS, 2019COMPANY ACT, 2017LABOR ACT, 2017 INDUSTRIAL ENTERPRISES ACT, 2016ENVIRONMENT PROTECTION RULES (5TH AMENDMENT), 2017 LAND RELATED REGULATIONSHYDROPOWER PROJECTS RELATED LAWS

Institutional Set-up

National Planning Commission• Overall National Plan and Project Allocation• Chaired by Hon. Prime Minister

www.npc.gov.np

Institutional Set-up

Office of the Investment Board• Overall PPP Execution• One stop solution• Chaired by Hon. Prime Minister• PPP & Investment bill approved – governs PPP and

FDI projects • IBN to approve schemes worth more than USD 55

million

http://www.ibn.gov.np/

National Project Bank (NPB)

• Depository of projects eligible for investment (i.e.

bankable projects) to be executed by the federal

government which will be selected on the basis of

predetermined process of project identification,

appraisal, selection and prioritization guidelines

developed by National Planning Commission.

Objectives

Project Good GovernanceCentral Depository of

Projects from different sectorBest value for MoneyEffective

Management and optimal utilization of valuable resources

Decision Making

Ready to Kick off projects

Identify development modals (e.g. Govt., EPC, EPCF, BT, BOOT, PPP, FDI)

Credibility Enhancement of Development ProjectsEffective mobilization of development cooperation based on its needs and priorities.

Appropriate, and evidence based allocation of projects in private and public sector.

Three stages of NPB

Stage 1: Project Identification

Stage 2: Project Appraisal

Stage 3:Project Selection & Prioritization

For each stage, integrated framework, process and tools are developed

Project Identification Process

Idea Generation

(Long list)

1Strategic Fit Assessment

(Shot List)

2Preferred Options

Selection

(Preferred Option)

3Prefeasibility/Desk

Study

(Report)

4Project

Concept Note(Final

Output)

5

Project Appraisal & Project Proposal Process

Feasibility Study1 DPR of a

Proposed Project2 Development

of Project Proposal3

Selection and Prioritization of Projects

• A priority list of projects shall be created in NPB.

• Offers a portfolio of strategic projects representing various sectors of investment in Nepal according to project readiness and project priority.

Procedures for establishing NPB

Project Identification

Gate 1(approval of PCN)

Project Appraisal

Gate 2(approval of

PP)

Project Selection &

Prioritization

NPBGate 3(approval for inclusion in NPB)

National Project Bank Management Information System (NPBMIS)

NPBMIS

npbmis.npc.gov.np

Mainstreaming of NPB

NPB General GuidelineNational Development Action Committee

(Chaired by Hon. Prime Minister)Approach Paper for 15th Periodic Plan Budget Formulation Guideline and MTEF

Multi-year Contract Standard for Projects, 2019PPP & FDI Bill

PPP Showcase Projects

• 7 Sectors – 70 Projects• Sector Wise Investment• Status• https://investmentsummitnepal.com/• project-showcase/

Way Forward

• Up scaling of NPB and NPBMIS • Capacity Development in NPC, IBN & line ministries• Sector specific harmonized guidelines including techniques,

tools, & methods• Enactment of PPP Act• Technical support • Networking and Knowledge Sharing

Thank you